Core Viewpoint - Options are a crucial component of the derivatives market, providing investors with tools to manage different market conditions through limited loss and flexible hedging and speculation strategies [1][9] Group 1: Bullish Market Strategies - In a significant bullish market, buying call options is an effective strategy when implied volatility is low, allowing investors to pay a relatively low premium for the right to buy the underlying asset at a predetermined price [1] - For a moderate bullish outlook, the bull spread strategy is more cost-effective, involving buying a low strike call option and selling a higher strike call option to reduce overall entry costs [2] - The maximum profit from the bull spread is the difference between the strike prices minus the net premium paid, making it suitable for scenarios where price increases are limited [2] Group 2: Bearish Market Strategies - In a significant bearish market, buying put options is a core strategy when implied volatility is low, allowing investors to sell the underlying asset at a predetermined price [4] - The maximum loss is limited to the premium paid, while the maximum profit is the strike price minus the underlying price minus the premium, making it suitable for investors expecting a clear downward trend [4] - For a moderate bearish outlook, the bear spread strategy involves buying a high strike put option and selling a low strike put option to lower net entry costs, with a clear risk-reward profile [6] Group 3: Neutral Market Strategies - In a sideways market, the core strategy is to capitalize on time decay or volatility contraction, with the short straddle strategy being suitable when prices are expected to remain within a narrow range [7] - This strategy involves selling both a call and a put option at the same strike price and expiration date, allowing investors to collect premiums as long as the underlying price does not exceed key levels [7] - The strategy carries unlimited loss risk if prices move significantly, making it suitable for traders with strong risk tolerance [7] Group 4: General Considerations - The selection of options strategies should align with market conditions, volatility expectations, and individual risk preferences, emphasizing the importance of liquidity management and risk control [9] - Understanding the applicable boundaries and risk characteristics of each strategy is essential for effectively leveraging their value in complex commodity markets [9]